Prime Minister Narendra Modi’s envisioned the ‘Make in India’ program and launched the initiative- Atmanirbhar Bharat or self-reliant India or self sufficient India on 12th May 2020.In recent years, there have been various business reforms in FDI and other sectors to boost the economy and also help the business environment to prosper. There is a need to be self-reliant more now than in the past – a lesson learned in the current pandemic. This does not mean that there will be no international trade and the economies will be closed ones. What this implies is that economies need to depend more on local resources to strengthen the economy from the grassroots levels and create a pool of population that is able to decently make their own living with respect and dignity. In the words of Prime Minister Narendra Modi -‘When India speaks of becoming self-reliant; it doesn’t advocate a self-centered system. In India’s self-reliance; there is a concern for the whole world’s happiness, cooperation and peace.’ For example, take the case of Personal Protection Equipment (PPE) kits which are essential in the current pandemic situation. Prior to the pandemic situation, India was not manufacturing Personal Protection Equipment (PPE) kits but they are now being manufactured in India itself. India has become the second-largest producer of PPE Kits globally with a daily production of more than 5 lakh PPE kits, according to the Union Minister for Chemical and Fertilizers D V Sadananda Gowda. (Pratishtha Nangia, Financial Express dated September 18, 2020). With ramped up production of PPE kits, India has become a producer for PPE kits now from being an importer. In terms of ventilators also, the production capacity in India has increased by up to 3 lakh units per annum. There are five pillars of Atma Nirbhar Bharat i.e. Economy, Infrastructure, Technology, Demand, and a Vibrant Demography. These pillars will be helpful for small and medium business establishments to establish themselves and also to start new ventures. The various sectors providing good opportunities for private investment & FDI are discussed below:
The two critical factors to attract private investment in India are firm demand and lesser uncertainty on return on investment. India attracted foreign investment of over USD 20 bn during COVID times. This was achieved by a strong economic capacity for manufacturing and restoring the financial health system. On 17th April 2020, India changed its Foreign Direct Investment (FDI) policy to protect Indian companies from “opportunistic takeovers/acquisitions of Indian companies due to the current COVID-19 Pandemic”,according to the Department for Promotion of Industry and Internal Trade (DPIIT). While the new FDI policy does not restrict markets, the policy ensures that all FDI investments by entities from countries that share a border with India will now require a clearance from the Centre. Distribution of foreign direct investment equity inflows in India for the financial year 2020, by sector (in billion Indian rupees):
Recently the government also made significant FDI announcements recently are as follows:
The Indian Government’s favourable policy regime and robust business environment has ensured that foreign capital keeps fl owing into the country. India’s economy is largely agrarian; however, it also has a booming services sector which includes construction, retail, software, IT, communications, hospitality, infrastructure operations, education, healthcare, banking and insurance etc. The services sector alone accounts for 55.6% of the total GDP. India has made a mark on the global economy with one of the world’s fastest-growing e-commerce markets. India has the world’s sixth-largest consumer market, which makes it an attractive investment destination. Government initiatives implemented over the years have successfully made India a hub of opportunities for foreign investors.